That Fabled British Auto Maker Rolls With the Changing Times : Cars: Rolls-Royce learns how to keep its handmade elegance while adapting to the harsh realities of the ‘90s. There’s even a move afoot--egad!--for a partnership.
Each time Dennis Jones finishes handcrafting a radiator for the front of a Rolls-Royce, he initials it with a double-D that looks something like a Texas cattle brand.
Once the Rolls-Royce is on the road, if the radiator requires repairs, it will return to Crewe and Jones will fix it. It’s his radiator, after all.
He dismisses a suggestion that a machine could do his work.
“It has to be done by hand to get its original design, finish and shape,” said Jones, who has signed more than 5,000 radiators over the past quarter-century.
This is the craftsmanship that makes Rolls-Royce the epitome of luxury for the world’s super-rich. Who else could afford to shell out $149,900 for a bottom-of-the-line Rolls-Royce Silver Dawn? Or $347,200 for a top-of-the-line limousine?
But while the 90-year-old Rolls-Royce Motor Cars Ltd. and its handmade cars are as quintessentially British as the queen and afternoon tea, its manufacturing traditions have undergone a radical shake-up in recent years. And in a second revolution of sorts, Rolls-Royce’s parent, Vickers PLC, is seeking a partnership with another, as-yet unidentified auto maker.
The global recession, which hit Rolls-Royce buyers hard, forced the changes. The company’s payroll was halved. Costs and production time fell dramatically with help from Japanese-style manufacturing practices. Some parts that used to be made by Rolls-Royce are now bought from other companies.
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But the Rolls-Royce tradition is still apparent on every inch of its cars.
Their leather seats are made from 10 to 12 hides per vehicle. Workers carefully match the leather before it is dyed, then meticulously study each hide to decide where to cut each piece.
Trim for the carpeting is made from less-fine leather from around the cow’s spine. But it must come from the same animals whose skin is used in the seats, to make an ideal match.
Of course, Rolls-Royce car owners can have their own individual touches. One American customer insisted on shipping over hides he chose himself. A Scottish customer used tartans between cowhide panels.
Wooden interior panels are selected with care and cut precisely through the grain to make mirror images of patterns. Woods like bird’s-eye maple, mahogany and walnut are used.
Customers can choose whatever items of comfort and extravagance they desire, like a fine-cut glass set for a back seat bar, or tiny televisions that fit into the backs of the front seat headrests for passengers to watch in the back.
But such detail may not be enough. Auto analyst Nick Cunningham of the London brokerage Barclays de Zoete Wedd believes Rolls-Royce needs to modernize its line, which now is about 12 years old.
“They need to develop a new car,” Cunningham said. “They need a new drive train. They need a new body and chassis, as well. Every year that passes, your vehicle gets older and it gets harder to sell to people.”
That will require hundreds of millions of dollars, money the company expects from its prospective partner.
In recent interviews, Rolls-Royce executives said no decision had been made about who the investor will be, playing down speculation by analysts in London that Mercedes-Benz will get the nod.
Talk of a partner for Rolls-Royce has stirred concerns in England that the company could be taken over, just as the last big British-owned mass producer of cars, Rover, was purchased by BMW of Germany earlier this year.
But Rolls-Royce insists it will still be Rolls-Royce.
“We’re talking collaboration, not equity,” said Richard N. Charlesworth, the company’s head of public affairs.
Whatever form the partnership takes, it will force the auto maker to adapt to the realities of the 1990s for a second time.
In the early part of the decade, Rolls-Royce had to contend with the worldwide economic bust. Although Rolls-Royce owners are often multimillionaires who tend to own more than one home and an average of five cars, it turned out they weren’t recession-proof.
During the boom of the mid- and late 1980s, worldwide sales of Rolls-Royces and the company’s Bentley line of cars soared from around 2,200 a year to a peak of 3,324 in 1990. But when the recession struck, sales plunged to 1,706 in 1991 and 1,375 in 1992, handing the company losses estimated in the hundreds of millions of dollars.
Rolls-Royce executives took a hard look at their business. They revamped the entire manufacturing system by creating Japanese-style teams that work closely with each other rather than being directed by middle managers.
“As a traditional management business, we didn’t encourage people to use as much initiative as we should have,” said Charles Matthews, managing director of operations. “The managers managed and the workers worked. We’ve eliminated much management. A lot of the management ideas are attributed to the Japanese; the other view is it’s common sense.”
Under the new practice, each working team is viewed as both a “supplier” and a “customer” of the parts used to make a Rolls-Royce.
A team that makes leather-crafted seats will be a customer of the finished leather but a supplier of the seats to whomever handles them next in the production line.
One worker used to spend up to three days making a front seat for a Rolls-Royce. If he was working on a black seat and the workers at the next stage of production needed a tan seat, they would have to wait.
Now, seats are made in one day by three workers sharing the task. This way, they can be much more responsive to the needs of colleagues who install the seats.
In all, Rolls-Royce made 4,500 changes. “They might be small individually, but the incremental effect is absolutely huge,” Matthews said.
His remarks echo words of founder Henry Rolls that are posted throughout the factory: “Small things make perfection, but perfection is no small thing.”
The changes have allowed Rolls-Royce to cut the time of producing one car from 65 days to 28 days. At any given time, 200 cars are in the production pipeline, down from 600 four years ago. This enables Rolls-Royce to save millions because expensive parts don’t sit around for weeks or months.
They’ve also lowered the company’s break-even point from 2,800 cars a year to 1,400.
Rolls-Royce might continue to find potential cuts, but after making big changes, this becomes increasingly difficult.
“There’s probably some nuts-and-bolts type stuff to say goodby to,” Matthews said, adding this does not mean someday cheap leather seats could come in from someplace like Eastern Europe.
The fine details that make a Rolls what it is will continue to be the work of craftsmen in Crewe, who are happy to have customers come along to watch their cars being built and to make suggestions.
